Second Quarter Report - Dhiraagu...We launched Huawei’s flagship brands, Huawei P30 and Huawei P30...

Second Quarter ReportApril to June 2019Dhivehi Raajjeyge Gulhun PLCwww.dhiraagu.com.mv

Dhiraagu is the leading digital and telecommunications service provider in the Maldives. Our business is to provide future-proof digital and telecommunications connectivity that enables our customers to get ahead in the digital future.

We are the pioneers that ushered the Maldives into the digital age, and we continue to lead the field by placing premium value on customer experience and consistent innovation. With over half a million customers, and an employee base comprising 99% trained Maldivians and presence throughout the country, we remain committed to enrich our customers’ lives through digital services.

Dhiraagu brings the latest innovations and technology to help all our customers succeed in an increasingly connected world. We offer a comprehensive range of services spanning from mobile, internet, data, TV, mobile money and fixed services.

We also ensure reliable international connectivity and coverage within the Maldives. We consider ourselves a partner for business growth and provide leading enterprise solutions and offer our customers peace of mind

Developments During the Quarter

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Dhiraagu | 2nd Quarter Report 2019

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Digital transformation continued to be the strategic agenda driving the success of Dhiraagu.

One of the key milestones achieved was the expansion of Dhiraagu FTTH project, marking the achievement of 75% household coverage across the country. This key milestone was marked in April at a special function graced by His Excellency Ibrahim Mohamed Solih, President of the Republic of Maldives.

At this function, Dhiraagu also unveiled its ‘Digital Raajje’ Program, which seeks to leverage the latest digital communications technology towards the social and economic wellbeing of the island nation.

Summary 1.1 As part of this Program, for the first time in Maldives, Dhiraagu introduced Gigabit speed internet of up to 1Gbps providing the fastest broadband connection to both residential and business customers. The Gigabit speed service is available at 10 different islands, allowing customers to experience the best speed ideal for downloading movies and music, online gaming and streaming high quality videos.

Dhiraagu also established Dhiraagu WiFi Hotspots at different public locations in Male’ and beyond to enable greater accessibility to everyone.

During the quarter, more value was extended to Dhiraagu TV customers as well by launching Video-on-Demand (VoD) feature on DhiraaguTV for the first time and introduction of a new TV package with two new add-ons.

Dhiraagu launched the Huawei P30 and P30Pro handsets with special installment plans, to provide Dhiraagu customers with convenient and affordable access to the latest smartphone technology.

Special promotions were launched to celebrate the month of Ramadan and Eid, including launching of a special discount plan on fixed broadband, new data bundles with extra social media allowance, discounts from selected restaurants and shopping outlets for payments made through DhiraaguPay, to suit the digital lifestyles of customers.During the second quarter, Dhiraagu reported a 2% increase in revenue vs the same period in 2018 driven by growth in fibre broadband, enterprise and adjacent services. Compared with


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the previous quarter there was a 0.3% increase in revenue with growth in enterprise offset by a reduction in seasonal roaming revenue.

Net profit and earnings per share decreased vs the prior quarter due to lower seasonal roaming and higher operating costs. Net cash flow increased in the quarter mainly due to an increase in operating cash flow, partially offset by an increase in capital expenditure.

Dhiraagu continued to support youth development in sports. The company extended sponsorship support to various activities engaging youth, including Mamen Interschool Bike Championship, Addu-Mamen Interschool Football Tournament and Dhiraagu Dhivehi Premier League.Key CSR highlights reflected our focus to support the local startup culture and on fostering innovation. During the quarter, we held Lean Startup Machine, the world’s leading startup workshop together with our partner Sparkhub.

As part of our ongoing efforts to care for the oceans, our staff engaged in beach cleanups to help intercept ocean plastic in Addu Atoll, Fuvahmulah and Kulhudhuffushi.

We also announced our partnership with UNDP Maldives to implement two key projects this year under SDG 13- Climate Action- Drones for Resilience and Film for Change Climate Edition.


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Fibre Broadband to 75% of the Households

Fixed Broadband

Baiskoafu Subscription

Huawei P30 LaunchDhiraagu TV

We celebrated a major milestone of achieving 75% of household coverage on our Fibre Broadband network across the nation. This milestone was marked at special function graced by His Excellency Ibrahim Mohamed Solih, President of the Republic of Maldives.

During the event, we also unveiled “Digital Raajje” for our users, to enrich the socio-economic wellbeing of our community by leveraging the latest digital communications technology.

We offered 25% discount on all existing fixed broadband boosters and offered free connections for new subscriptions on FBB with 30% extra allowance during April and May.

We introduced a special monthly subscription of MVR 69 on Baiskoafu exclusively for Dhiraagu customers, offering them unlimited access to a great variety of original local content.

We launched Huawei’s flagship brands, Huawei P30 and Huawei P30 Pro, with free 5GB data for 6 months enabling our customers to conveniently experience the latest smartphone technology in the market.

DhiraaguTV introduced a new package and two add-ons; “Fun” and “Excitement”. As a promotional offer, customers were given Excitement add-on for free until the end of July, which has a diverse set of over 22 channels.

We enabled Video-on Demand (VoD) feature on DhiraaguTV with Nickelodeon, one of the most popular kids’ entertainment shows.

Key Commercial Highlights1.2


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Ramadan Data Bundle Zakat Pay

Digital Engagement Activities

DhiraaguPay

Saudi IDD offer

Similar to last year, 10% of each data bundle purchase was donated to a local charity. This year we donated MVR 366,000 to Maldives Association of Persons with Disabilities (MAPD), to support their cause towards improving the life of people with disabilities.

We also facilitated Zakat payment through DhiraaguPay and SMS, to help our customers pay alms more conveniently.

We vamped up our digital engagement during Ramadan. Activities included;

‘Dhivehinge Raha’: a video-based cooking series where the inspirations and dishes are local cuisine.

‘Roadha Moments’: we ran an Instagram contest in partnership with Samsung, which invited users to share their moments of happiness during the day, to help keep the spirit of Ramadan alive. Weekly winners were awarded Samsung Galaxy A80 phones.

‘Mee Koacheh’: a weekly guessing challenge on Twitter where users had to announce the name of the macro/abstract item on each post using the provided hashtags.

Thashibari Movement: we reinitiated the ‘Thashibari Movement’ on Social Media to revive our tradition of sharing during the month of Ramadan

A special promotion was run for, DhiraaguPay customers at the local Market, and fish Market.

We also offered a discounted call rate for our customers during Ramadan to get in touch with their loved ones in Saudi.

Ramadan Campaign


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Viber Sticker Subscription

Eid Promo 1GbpsDhiraagu Hotspots

We launched an exclusive offer for mobile customers to purchase premium Viber sticker package for just MVR 19 per month

We launched two new data bundles exclusively for Eid, letting our customers enjoy 2GB extra allowance on Social Media

Our 1Gbps package was launched at the end of June. For the first time in the Maldives, customers can subscribe to 1 Gbps. The premium service is currently available in 10 islands.

As part of the initiative to improve digital accessibility, Dhiraagu Wi-Fi hotspots were opened at parks and public locations across Male’ and Greater Male’.

Key Commercial Highlights1.2


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Mamen Interschool Bike Championship to promote an active lifestyle and increase the popularity of cycling amongst our youth.

Addu-Mamen Interschool Football Tournament, as part of our youth engagement initiatives.

Dhiraagu Dhivehi Premier League, to support development of Maldivian football and build unity through sports.

‘Raalhu Gudi’- Kite Surfing Event, to raise awareness of plastic pollution.

SponsorshipsWe continued our support in various areas of youth development and social causes. Highlights include:


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Awards & Recognitions

Recreation/Staff Engagement Health & Safety updates

Employee Training and Engagement

We received an appreciation award from Maldivian Red Crescent at their 10th General Assembly for supporting humanitarian work as a corporate member.

Dhiraagu staff Quran/Madhah competition and Roadha Festival held from 12th May to 25th May. Over 200 staff across the company participated in the activities.

Dhiraagu Futsal Team took part in the Club Maldives Cup 2019.

Fire Safety Inspections at Regional Operational Centers and Greater Male’ sites were carried out during the quarter.

Flu vaccination arranged for Dhiraagu staff and families and a total 324 staff and family members were vaccinated.

We strive to maintain our focus on our employee’s professional development, health, safety, and engagement.

During the quarter, we provided training to 64 employees, with focus on upskilling and providing the tools to achieve our strategic initiatives.

Organizational Highlights 1.3


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Empowering Young People

As a champion for supporting and encouraging persons with disabilities, we celebrated the success of the young athletes for winning gold and silver for Maldives from the 2019 Special Olympics World Games for persons with intellectual disabilities at DHO with our staff

With our focus to support the start-up culture and foster innovation, we introduced Lean Startup Machine, the world’s leading start-up workshop in Maldives in partnership with Sparkhub. The intensive three- day workshop emphases the importance of validating ideas before they are built.

Together with our partners, we announced Angelhack Maldives 2019, the worlds’ largest and the only international hackathon series in Maldives.

To mark Girls in ICT day, a team of our female staff spoke at school assemblies in Addu Atoll, Fuvahmulah, Kulhudhuffushi, Eydhafushi and Vilimale’ to inspire and encourage girls to pursue careers in ICT.

We extended our support to the National Centre for the Holy Quran by providing our Digital Connectivity solution for the centre to conduct Quran courses in Laamu Fonadhoo and Fuvahmulah.

Corporate Social Responsibility 1.4


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Care for Children

On Children’s Day, we opened “Dhiraagu Kids Zone” after renovating the Children’s Play Area at Indhira Ghandi Memorial Hospital.

As part of our Eid Al Fitr celebrations, staff from our Head Office and Regional Operation Centres volunteered to distribute Eid Gifts to children across Maldives.

We renewed our membership with GSMA Mobile Alliance Against Child Sexual Abuse Content to block child sexual abuse content on Dhiraagu network.

On World Autism Awareness Day, we supported a special video song by Dhiraagu Brand Ambassador Mariyam Maeesha to promote messages on inclusiveness, acceptance and respect to help raise awareness on the cause.



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Care for Environment

We announced our partnership with UNDP to implement two key projects - ‘Drones for Resilience’ and ‘Film for Change Climate Edition’ under the Sustainable Development Goal (SDG) 13: Climate Action. Utilizing drone technology, detailed maps would be produced for 4 islands based on disaster risk assessment, providing the means for more informed disaster preparedness and disaster risk management. This year, Film for Change Climate Edition is aimed to explore and form narratives on issues of climate change in Maldives.

Our CEO pledged to stay committed and to continue our efforts within the organisation to reduce single use plastic at the World Oceans Day event by Ministry of Fisheries, Marine Resources and Agriculture and Parley Maldives.

Our teams participated in beach clean-ups in Fuvahmulah, Kulhudhuffushi and in four areas of Addu Atoll to help intercept ocean plastic as part of the Raalhu Gudi Kite Surfing fest together with Parley Maldives, NGOs, schools and the community.

To mark World Environment Day, our staff participated in a special bicycle ride together with the Ministry of Environment and Bike Maldives to create awareness on clean air.



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Key Financial Highlights

02


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AS AT

ASSETS AND LIABILITIES

Non-Current Assets

Intangible Assets

Property, Plant and Equipment

Right of Use Asset

Deferred Tax Asset

Total Non-Current Assets

Current Assets

Inventories

Trade and Other Receivables

Cash and Bank Balances

Total Current Assets

Total Assets

Current Liabilities

Trade and Other Payables

Amounts Due to Related Party

Right of Use Liability – Current

Current Tax Liabilities

Total Current Liabilities

30 Jun 2019 MVR “000”

30 Jun 2019 MVR “000”

31 Mar 2019 MVR “000”

31 Mar 2019 MVR “000”

291,344

1,778,869

218,442

16,616

2,305,271

66,995

622,653

434,498

1,124,146

3,429,417

(620,189)

(1,934)

(27,899)

(80,681)

(730,703)

276,726

1,819,139

219,587

20,486

2,335,938

65,070

604,286

536,723

1,206,079

3,542,017

(523,000)

(1,723)

(30,187)

(53,083)

(607,993)

Non-Current Liabilities

Provisions

Right of Use Liability – Non-Current

Total Non-current Liabilities

Total Liabilities

Net Assets

Equity

Share Capital

Retained Earnings

Total Equity

(176,493)

(195,054)

(371,547)

(1,102,250)

2,327,167

190,000

2,137,167

2,327,167

(173,533)

(191,707)

(365,240)

(973,233)

2,568,784

190,000

2,378,784

2,568,784

Balance Sheet (Unaudited) 2.1


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FOR THE QUARTER ENDED FOR THE QUARTER ENDED

Revenue

Operating Costs

Depreciation and Amortization

Other Income

Results from Operating Activities

Net Financing Expense

Profit Before Tax

Tax Expense

Profit for the period

Share Performance Ratios

Basic Earnings Per Share (Annualized MVR)

Basic Earnings Per Share (Quarter MVR)

Net Cash Inflow

from Operating Activities

Net Outflow from Investing Activities

Net Outflow from Financing Activities

Net Increase in Cash

and Cash Equivalents

Cash and Cash Equivalents

at beginning of the Period

Cash and Cash Equivalents

at end of the Period

710,824

(350,608)

(95,344)

255

265,127

(13,397)

251,730

(41,147)

210,583

11.08

2.77

334,332

(54,849)

(376,306)

96,823

517,027

420,204

708,675

(324,149)

(91,807)

268

292,987

(12,312)

280,675

(41,734)

238,941

12.56

3.14

259,920

(41,128)

(17,740)

201,052

315,975

517,027

Robin WallChief Financial Officer

Ismail RasheedCEO & Managing Director

Income Statement (Unaudited)

Cash Flow Statement (Unaudited)

2.2 2.3

30 Jun 2019 MVR “000”

30 Jun 2019 MVR “000”

31 Mar 2019 MVR “000”

31 Mar 2019 MVR “000”


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Governance03


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No changes were brought to the composition of the Board during the second quarter of 2019. The Board composition as at 30 June 2019 was as follows.

* RNG Committee = Remuneration, Nomination and Governance Committee

Mr. Ismail Waheed

Mr. Oliver McFall

Mrs. Khulood Rashid AlQattan

Mr. Khalid Taqi

Mr. Imran Ali Mr. Ihab Hinnawi

Mr. Ismail Rasheed

Chairperson, Remuneration, Nomination and Governance Committee

Chairperson, Audit Committee

Member, RNG Committee

Member, Audit Committee & RNG Committee

Chairperson, Directors

Director

Deputy Chairperson, Director

Director

DirectorDirector

Chief Executive Officer & MD

Non-Executive & Independent




Non-Executive & IndependentNon-Executive & Independent

Executive & Non- Independent

Board Composition 3.1


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During the second quarter of the year, one Board Meeting, one Audit Committee Meeting and one Remuneration, Nomination and Governance Committee Meeting were held.

The 30th Annual General Meeting of Dhiraagu Plc was held on 25th April 2019 at the Convention Hall of Kurumba, Maldives. The meeting was attended by 84 shareholders representing 94% of the shareholding of the Company. Important resolutions passed at the meeting includes:

Approval of Interim Condensed Financial Statements for the quarter ending 31 March 2019 Appointment of Deputy Chairperson to the Board Approval of the disposal and write-off of fixed assets with GBV $19m (NBV 0). Approval of 2019 Revised Budget Appointing Member to the RNG Committee Approval of Recommending Standing Resolution to declare Interim Dividend in 2019

Approval of the Annual Report 2018 including the Director’s Report and Audited Financial Statement for the year ended 31 December 2018.

Declaration of a full year dividend of MVR 11.91 per share, amounting to MVR 905,160,000 (Maldivian Rufiyaa Nine Hundred and Five Million, One Hundred and Sixty Thousand) for the financial year 2018. The full year dividend was made up of:

Interim Dividend of MVR 5.96 per share (total MVR 452,960,000) paid in 2018, and Final Dividend of MVR 5.95 per share (total MVR 452,200,000) declared at the 30th Annual General Meeting for shareholder approval.

Re-appointment of KPMG as the Company’s External Auditors for the financial year ending 31 December 2019, to carry out the statutory audit for the year ending 31st December 2019, and approval of External Auditors fees.

Granting the Board of Directors the authority to approve and declare any interim dividend in accordance with the Company’s Dividend Policy during the financial year 2019.

Important Board decisions made during Quarter included:

Board Activity 30th Annual General Meeting

Board Decisions

3.2 3.4

3.3


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The company complied with the CMDA’s Corporate Governance Code and Dhiraagu Corporate Governance Code during the quarter. Highlights include ensuring regular, timely and effective disclosures as required by the Code.

The company’s Corporate Governance Code can be viewed in the investor relations section of the Dhiraagu website.

This report has been prepared in compliance with CMDA’s Minimum Quarterly Reporting Requirements for Listed Companies.

Legal & Regulatory Compliance

Reporting Compliance

3.5

3.6


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Investor Relations 04


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Shareholding

BTC Islands Limited (Batelco)

Government of Maldives

Public

Highest Traded Price (MVR)

Lowest Traded Price (MVR)

Last Traded Price (MVR)

Number of Shares Traded

Number of Trades

Weighted Average Traded Price (MVR)

Market Capitalization as at quarter end (MVR)

EPS (Annualized MVR)

P/E Ratio (Annualized)

Net Asset Per Share (MVR)

Dividend Yield

%

Q2 2019

No. of Shares

Q1 2019

52.0%

41.8%

6.2%

100%

100

86

86

3,704

7

98.87

6.54bn

11.08

7.76

30.62

NA39,520,000

31,770,150

4,709,850

76,000,000

85

80

85

608

7

84.15

6.08bn

12.56

6.77

33.80

NA

The company’s shareholding as at 30th June 2019 was as follows:

Shareholding Shareholding

Trading Highlights

4.1 4.1

4.2

Q2 2019 Q1 2019


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Second Quarter Report - Dhiraagu...We launched Huawei’s flagship brands, Huawei P30 and Huawei P30...

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